LTD TSXV.RRL January 2015
Forward Looking Statements • This presentation contains forward -looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words "will", "expects", "believe", "plans", "potential" and similar expressions are intended to identify forward-looking statements or information. • More particularly and without limitation, this presentation contains forward looking statements and information concerning: Relentless’s future plans and strategy; estimated production and reserves and anticipated increases in production and reserves; development and drilling programs, plans and opportunities; expected finding and development costs and on-stream costs; netback and well economics; future development and growth opportunities; cash flow, net asset value and reserves life. • The forward -looking statements and information in this presentation are based on certain key expectations and assumptions made by Relentless; including prevailing commodity prices and exchange rates; applicable royalty rates and tax laws; future well production rates; reserve and resource volumes; the performance of existing wells; the success obtained in drilling new wells; the sufficiency of budgeted capital expenditures in carrying out planned activities; the availability and cost of labour and services; and the receipt, in a timely manner of regulatory, stock exchange and other required approvals. Although Relentless believes that the expectations and assumptions on which such forward-looking statements and information are based are reasonable, undue reliance should not be placed on the forward-looking statements and information because Relentless can give no assurance that they will prove to be correct. There is no certainty that Relentless will achieve commercially viable production from its undeveloped lands and prospects. • Certain information set forth in this document, including management’s assessment of Relentless’s future plans and operations, contains forward-looking statements including: (i) forecasted capital expenditures and plans; (ii) exploration, drilling and development plans; (iii) prospects and drilling inventory and locations; (iv) anticipated production rates; (v) expected royalty rate; (vi) anticipated operating and service costs; (vii) our financial strength; (viii) incremental development opportunities; (ix) total shareholder return; (x) growth prospects; (xi) sources of funding, which are provided to allow investors to better understand our business. By their nature, forward-looking statements are subject to numerous risks and uncertainties; some of which are beyond Relentless’s control, including the impact of general economic conditions, industry conditions, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, changes in environmental tax and royalty legislation, competition from other industry participants, the lack of availability of qualified personnel or management, stock market volatility and ability to access sufficient capital from internal and external sources. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. Relentless’s actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements or if any of them do so, what benefits that Relentless will derive there from. Relentless disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. • Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other facto rs that could affect the operations or financial results of Relentless are included in reports on file with applicable securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com). • The forward -looking statements and information contained in this presentation are made as of the date hereof and Relentless undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws. Boe Advisory • The term " boe" or barrels of oil equivalent may be misleading, particularly if used in isolation. A Boe conversion ratio of six thousand cubic feet per barrel (6 Mcf: 1 Bbl) of natural gas to barrels of oil equivalence is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
Management & Directors CEO/Chairman - Dan Wilson - P.Eng 28 years- Alexander, Vigilant, Relentless Energy, Chain President/Director- Ron Peshke - P.Eng 17 years- Alexander, Haywood, Cinch, Valiant, Baytex, Fletcher Challenge CFO – Hugh Thomson - CA 22 years- Alexander, New North, Trenton, Dundee Director - W. C. (Bill) Macdonald 34 years- Alexander, Bilmac, Avalanche, DeKalb, Amerada Hess, Hardy Director - Murray Frame 40 years – Canoil, Inverness
RRL Opportunity • Ground floor opportunity on a growing, micro oil and gas publicly traded junior. $13MM EV @$0.20/share with significant un-booked value adds • Large leverage on conventional shallow oil drilling and recompletion opportunities. High working interest, large OOIP shallow oil recompletion and drilling • High returns on investment and quick well payouts promote cash flow sustainability. Low capital projects on multiple oil opportunities • Accretive production purchase on operated, stable Peace River arch assets with un-booked horizontal upside. • Multiple oil horizontal targets ranging from Doe Creek, Glauconite, Cardium Viking and Charlie Lake horizons. - Conventional production declines • Near term growth to 500 boed targeting greater than 50% oil weighting and greater than $30.00/boe operating netbacks. Capital efficient recompletion production adds • Low corporate G&A and interest expense. • Motivated Management team, experienced Board of Directors. • Continuing accretive A&D and land assembly on shallow oil opportunities. • Seek to realize un-booked upside.
Corporate Information – Base NAV Relentless Resources Base Producing NPV – 63.8MM shares basic, 71.1MM fully diluted Reserves • Management and Directors own 38% Sproule Dec 2013/March 2014 Combined basic and 44% fully diluted Basic Shares – 63.8MM • PDP NPV 10% - $7.1MM $3.0MM Available Bank Line TP NPV 10% – $7.2MM • Working capital of $1.3MM TP+P NPV 10% - $9.3MM • Estimated Current Production : 300 boed, (Before tax) 55% oil No land, undeveloped locations (76% PDP), or Heathdale • Gold Creek, Heathdale, Pine Creek, recomplete/drilling value included above Valhalla, Willesden Green and Gilby Trading at $43,000 EV/BOED at • 57,000 gross acres (55,000 net acres) $0.20/share
Areas of Operation Peace River Arch AB – 8,200 acres – Doe Creek, Charlie Lake, Doig and Montney Pine Creek/Willesden Green/Ferrier AB – 14,240 acres – Cardium, Viking, Second White Specs Focus Gilby AB – 26,900 acres – Ellerslie Glauconite Viking Area Historical Heathdale AB – 6,000 acres – Glauconite Detrital Area Banff Focus Area Others: Gordondale, Pageant
Peace River Arch SADDLE HILLS UNIT – Doe Creek Oil • May 2014 Acquisition – $3.0MM for 127 boed – 64% gas, ~$1.4MM OCF • 12 gross (7.4 net wells), 3 (1.4 net) non producing wells VALHALLA – • Mostly operated, mature, low decline gassy oil Charlie Lake Oil wells • Future horizontal development in Charlie Lake and Doe Creek GOLD CREEK – • Doe Creek Oil Accretive purchase metrics of $24,000/boed and $9.38/boe P+P • PDP NPV @$3.5MM, TP+P @$5.9MM • >$30.00/boe operating netbacks • Acquisition adds to balance sheet strength as the price is equivalent to lending value
Heathdale • 4 sections @ 100 % WI , farm-in on remaining 4.5 sections • >25 Mannville oil locations , 26 API crude, 1000 mTVD • Historical vertical oil production on lands • Bypassed pay over 4 sections • 5-7 vertical wellbore shows thick Glauconite channel deposit • 3D seismic analysis shows further thickening of Glauconite sequence • 8-7 W4 horizontal IP30 at 160 boed and currently at 100 boed (80% oil) • Low producing GOR’s and thick pay/OOIP promote downspacing • Conventional declines - porosities greater than 21% • 100 boed IP, 65 boed FYA • 100 MBOE EUR/well • $1.50MM Capex, $1.8MM NPV/well, Payout <1.5 yrs. • IRR > 35% • $70 WTI, 1.1 Exchange, $10 differential • FY operating netback > $35/boe Hanna Glauconite Type Curve 120.0 100.0 Type Curve 100 MBOE 80.0 Cal Day BOED 60.0 40.0 20.0 0.0 0 2 4 6 8 10 12 14 16 18 20 22 24 Months on Production
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